Coming on the back of its first annual conference in Detroit aimed at connecting U.S. businesses with Chinese consumers, Alibaba Group (BABA), the Chinese ecommerce giant, launched a new website to support the effort.
Dubbed the Taobao Global U.S. Merchants Network, the company said it will provide small and medium-size businesses in the U.S. with access to more than 500 million consumers that are on Alibaba’s ecommerce platform.
"The merchants who join this network are experts on Chinese consumers and are continually seeking new, unique American products for the millions of Chinese consumers they reach on Taobao," said President Michael Evans in a statement covered by the media. “Being a part of this network will enable these merchants to more efficiently identify and work with U.S. small businesses to bring their products to Chinese consumers.” Alibaba said the merchants network is launching with more than 300 American members. (See also: Alibaba Aims to Become World's Fifth Largest Economy by 2036.)
A $4.89 Trillion Market
The announcement on the part of the Chinese powerhouse comes just a couple of weeks after the company was in Detroit to court independent U.S. businesses through its first ever Gateway 17 conference, which brought around 3,000 entrepreneurs to the city to learn how easy it is to sell their products in China. It was expected to draw small businesses from 48 states that were interested in entering the Chinese market, which has bypassed the U.S. this year to become the world's biggest retail market. Research firm eMarketer pegs the market opportunity at $4.89 trillion, while the U.S. stands at $4.82 trillion. (See also: China: Alibaba to Launch Confab for US Businesses.)
For Alibaba, the confab is strategically important given the company’s core market is getting saturated and it is facing intense competition from local and international rivals. In an interview with TheStreet.com, Joe Tsai, the co-founder and vice chairman of the internet giant said courting businesses in the U.S. is part of the mission to help small businesses. When announcing the event in April, Alibaba Chairman Jack Ma said in an open letter that the Chinese market presents “tremendous opportunities” and that the middle-class population in China is expected to surpass 600 million by 2022, nearly twice the size of the U.S. population.
The Taobao Marketplace has been around since May 2003, starting out as a consumer-to-consumer website that provided small businesses and entrepreneurs the ability to sell their products and services over the internet. It expanded a few years later, becoming a online destination for Chinese consumers to purchase high-quality foreign goods from overseas small businesses, reported TheStreet.com. In fiscal year 2017, the value of all the items sold on Taobao increased 17% to $320 billion, noted TheStreet.com.